1Q24 Investor Letter
“We believe today’s most market participant tries to build differentiated views on topline growth. We are not capable of capturing “how big this thing is”; rather, we found that the higher the growth rate than GDP, the harder it is for us to predict its consistency. We do look at topline potential, but it works more like a distant and blurred background. With such a background in place, we pay much more attention to how supply is controlled than to how big the demand is.
We try to land our differentiated views in all others. A 15% growth in intrinsic value per share can be achieved by growing the topline by 15%, growing earnings by 15%, back 15% of shares, or paying down a certain amount of debt. But the capital intensity is paid the most attention at Dawnlight. Not only because it is the lever for all others but also because it determines the extent of the optionality a business can have. ”